Volume 62, No. 5 May 2006
Massachusetts has achieved the impossible. The Health Reform
Bill, which passed by 154-2 in the House and 37-0 in the Senate,
"does what health experts say no other state has yet been able to
do" (Pam Belluck NY Times 4/5/06).
Republican Governor Mitt Romney outsmarted the Democrats to
get "95% of what I proposed." The "landmark" achievement provides
insurance for all "without raising taxes and without a government
takeover." The compromise should inspire other states, said Paul
Applauding the bill are the Massachusetts Medical Society,
the Coalition for Social Justice, Families USA, Health Care for
All, Sen. Edward Kennedy and the Heritage Foundation.
The goals are represented by some numbers, writes Arnold
Kling (Wall St J 4/7/06): Affordability (the $295
per worker penalty for employers who don't offer coverage);
insulation from costs ($0 deductibles, copayments, and
premiums for the poor); and access (the $6,000 average
annual expenditure on medical care for a Massachusetts resident).
Problem solved: providing only that you "abolish the laws of
The wedge that is supposed to open Massachusetts to the free
market, the Connector is like a stock exchange or a giant car
dealership, writes Edmund Haislmaier of Heritage. It has also
been compared to the Federal Employee Health Benefits Program
(FEHBP). Its "single administrative structure" helps to
rationalize the "fragmented, balkanized health-insurance market."
This Heritage-authored idea is a "marketplace" not a "sop to
socialism," he insists (
Employees of businesses with 50 or fewer workers will be
able to purchase individual coverage through the Connector with
pre-tax dollars. More than one employer can contribute for a
given worker, and coverage would be portable.
According to the Conference Committee Report, the Connector
must certify that all products are of "high value and good
quality." All current mandated benefits are "protected." Current
regulations on deductibles and co-pays apply except that products
with a Health Savings Account (HSA) may have a slightly higher
deductible. The sole providers of subsidized coverage will, at
least initially, be managed care organizations.
Enforcement and Funding
The individual mandate to purchase a "creditable" insurance
policy what Romney calls the "personal responsibility"
requirement is enforced by tax penalties. At first, the
individual would lose his personal state tax exemption, now worth
about $150. The second year, he would incur a fine equal to about
half the premium cost of the least expensive product available,
around $1,200 for a young adult. There are no criminal penalties
for failing to buy insurance.
All residents would have to indicate on their state income
tax returns, under oath, whether they had creditable coverage for
the entire 12 months. If they say they didn't, or if the commis-
sioner determines that they actually didn't, any tax refund would
be withheld, and if that is insufficient, all available
enforcement procedures will be used to collect.
Realistically, penalties could be collected only from the
uninsured with moderate or high incomes. But an important
principle has been accepted, points out Michael Tanner: the
responsibility of government to ensure that every American has
health insurance (Cato Policy Analysis 565, 4/5/06).
Romney rejected an employer mandate and views the $295
"fair share contribution" (by employers who hire 11 or
more workers but don't provide insurance) as a "fee," not a "tax
increase." He writes that the Democrats added it and he "will
take corrective action" (WSJ 4/11/06). In addition to
the $295, a "free rider surcharge" (up to 100% of state-
paid costs) would be levied on "non-providing" employers whose
employees used more than a threshold amount ($50,000) of
uncompensated services. Those who didn't pay promptly would face
an annual interest rate of 18% and monthly late fees of 5%.
To protect $385 million/year for 2 years in pledged federal
Medicaid funds, Massachusetts had to figure out how to lower the
number of uninsured by July: perhaps the reason the bill is
deemed an emergency measure. To make coverage "affordable," about
$700 million in premium subsidies will be needed, about four
times the amount provided in the bill, according to Professor
Alan Sager of Boston University (WSJ 4/5/06). About $1
billion a year will be shifted around, as by redirecting money -
now paid to hospitals for uncompensated care.
Data and Controls
The biggest penalties in the law are fines up to $50,000 for
insurers or providers who fail to submit required data within the
time allowed. The bureaucracy will track insurance status,
income, participation in "wellness" programs, quality measures,
and costs (but specifically not payment rates by
The plan demands more "diversity" in the health workforce,
the elimination of racial and ethnic "disparities" in health
outcomes, adherence to quality standards, and achieving
performance benchmarks. Hospital rate increases will be
contingent upon meeting such goals.
Drew Altman of Kaiser Family Foundation describes the plan
as a "Cuisinart-style package that breaks through the ideological
logjam by borrowing from the left, the right, and the center" (E.
Mehren, LA Times 4/8/06).
Another description might be a witch's brew. When it fails,
expect a demand for stronger magic: single payer.
Views on the Massachusetts Plan
Comparing the Massachusetts law to HillaryCare, Twila Brase,
R.N., of the Citizen's Council on Health Care writes: "An
intrusive and prescriptive bureaucracy will be authorized to
ration health care and make decisions about who gets what health
care when. Health care decisions will be taken out of the hands
of patients and doctors as the agendas of special
Read the complete bill at www.hcfama.org/act/ and CCHC's
concise overview at www.cchconline.org.
Because physicians will be forced to submit patient data to
a central clearinghouse, there will be no way to maintain truly
confidential relationships, observes Sue Blevins of the Institute
for Health Freedom. The health care quality and cost council
established by the bill has the authority to promulgate its own
rules and is specifically not subject to control of the executive
office of health and human services.
Blevins also notes the difference between freedom
and the limited choice among government-approved plans
that will be allowed in Massachusetts (www.forhealthfreedom.org).
"Personal responsibility," writes Joseph Lee Pugh of
Mississippi, "certainly does not mean that health costs incurred
by a individual are, by law, transferred to an employer or to
another taxpayer. This is a dangerous precedent."
If personal responsibility and keeping other people from
having to pay were the point, suggests Linda Gorman of the
Independence Institute, Romney could have proposed requiring
everyone to buy a policy with a deductible of $20,000 or more
with state premium subsidies, and then permitting the state to
seize the assets of persons who didn't pay amounts below the
deductible. Most people, she writes, have $20,000 in assets. The
insurance would be affordable, and hospitals would get paid for
big events. Instead, Massachusetts kept the very things that make
insurance unaffordable: community rating and mandated
benefits. It will attempt to "hide the subsidies and pass them
around like a hot potato."
Why do people appear to believe that "one central
administrative structure reduces costs when data, experience,
and theory say that it doesn't?" Gorman asks. It's as if they
think that "the Massachusetts association with witches gives it
some kind of claim on magic": just "tax producers more heavily
and give money to the same people who made uncompensated care so
much more rewarding than Medicaid."
Mandatory Auto Insurance
In states requiring auto insurance, about 15% of drivers are
uninsured, "almost exactly the percentage of people without
health insurance, with no mandate," writes Greg Scandlen.
As a result of mandates, government gains control of pricing
and product structure, writes Linda Gorman. One creates "a whole
new class of lawbreakers, huge data demands to enable
enforcement, fertile new ground for a new government plantation
as people demand subsidies for those who can't afford the
mandatory product, and continuous redefinition of it as various
interest groups lobby for its expansion."
And what good does mandatory auto insurance do? To protect
assets and future wages, people have an incentive to buy
insurance. Those with no assets or no prospects to protect may
even risk jail terms to avoid buying mandated insurance. Without
mandates, we might have about the same situation as with them,
minus the regulatory costs, Gorman suggests.
The Sliding Scale and Progressive Taxes
The most important reason for not buying insurance is that
it is perceived to be too expensive. Mandated, universal coverage
with community rating subsidizes high risks by forcing low-risk
individuals to pay premiums enormously higher than their risk
status warrants. Additionally, the sliding scale subsidy, as in
the Massachusetts law, effectively forces more productive people
to pay more for their insurance. The bill is about
collective responsibility, not personal
responsibility, based on the Marxist axiom of "from each
according to his means, and to each according to his need."
In Canada, a person in the lowest decile of income (average
$8,500) pays taxes at a rate of 16%, and his health insurance
costs about $305. A person in the highest decile (average
$201,000) pays 58% in taxes, and nearly $27,000 for health
insurance (Fraser Forum, October 2005). The richest are
thus required to pay 87 times as much for theoretically the same
quality of care. If they are sick, more affluent Canadians often
pay the full cost of their care out of pocket, outside the
Should the price one must pay for all necessities be an
escalating percentage of one's income?
Socialized Medicine Updates
Medicaid's Unseen Costs. Michael Cannon reviews the
literature supporting the view that Medicaid exacerbates poverty
and the lack of affordable medical care. It discourages self
help, crowds out charity and other efforts, and encourages
overconsumption of care without measurable health gains (Cato
Policy Analysis 548, Aug 18, 2005, www.cato.org).
"Bonus Malus" Penalties in Germany. One of the more
draconian medical reform proposals of Chancellor Angela Merkel is
to make doctors personally liable for 50% of the excess spending
if their patients' prescription costs exceed their budgets by
more than 30% (TCSdaily.com 4/4/06).
"Maximum" Wait Becomes Minimum in the UK. The National
Health Service (NHS) is facing a œ800 million debt, and Health
Secretary Patricia Hewitt blames doctors for holding up
improvements. To save money, the Eastbourne Downs primary care
trust ordered the town's hospital not to operate on any patient
who had been waiting for less than the maximum permitted time of
6 months (www.healthplanusa.net/April06.htm).
Equally Bad Care for All
AAPS Past President Robert Cihak, M.D., summarizes a RAND
study published in the N Engl J Med of March 16. There
was no significant difference in care received by type of
insurance, or no insurance. "Seeing a doctor is much more
important than whatever kind of insurance you have," Dr. Cihak
concludes (www.newsmax.com 4/5/06).
May 11 (Allentown, PA), May 22 (Abington, PA).
May 19/20, 2006. Dinner meeting and Board of Directors
meeting, Hilton Garden Inn, Chicago O'Hare Airport.
Sept 13-16, 2006. 63rd annual meeting, Phoenix, AZ.
Effects of Medicare Exclusion Are Vast
A physician who is excluded from Medicare may be unable to
secure any kind of employment even as a ward clerk,
technician, or orderly in any medical facility that accepts
money from federal programs, or in an organization that contracts
with such a facility. Additionally, he would be barred from
receiving any federally insured loans or research grants.
The reason for exclusion may be loss of licensure for
"reasons bearing on professional competence, professional
performance, or financial integrity." The exclusion would
continue until and unless he regained his license in the state in
which it was originally lost.
An exclusion is not lifted automatically when the term
expires; the physician must apply for reinstatement.
One physician who lost his license in what appears to have
involved a political dispute with the licensure board writes:
"One of the most distressing issues is the fact that [HHS
officials] refuse to delineate the extent of the blacklist.
However, they have warned me that if I accidentally am hired in a
position I should not have had, I have committed a crime."
See http://oig.hhs.gov; click on
The Inspector General recommends: "health care providers
should periodically check the OIG web site for determining the
participation/exclusion status of current employees and
contractors." Those who do not do so risk civil monetary
penalties of up to $10,000 per item or service furnished by such
an individual, plus an assessment up to three times the amount
claimed and program exclusion.
Forced Drugging and the Death Penalty
The Nevada Supreme Court rejected a petition by the mother
of Daryl Mack, clearing the way for his execution, now scheduled
for April 26. Mack still asserts his innocence of the murder for
which he is being executed, but dropped all his appeals. He is
being injected with Haldol against his will. Because the prisoner
has been found competent when drugged, the Court held that his
"next friend" has no standing to argue on his behalf.
"The Court's reasoning opens the door to the use of drugs
that induce one to accept death by execution, and thereby drop
appeals," states AAPS General Counsel Andrew Schlafly.
JCAHO Assaults Medical Staff Self-Governance
In its new Medical Standard 1.20, the Joint Commission on
the Accreditation of Healthcare Organizations proposes to move
things like fair hearings and credentialing from medical staff
bylaws to "associated administrative proceedings" where they can
be modified more easily, perhaps without a vote by the medical
www.jcaho.org). JCAHO is now collaborating in
hospitals' efforts to undermine self-governance by the medical
staff, writes Dr. Lawrence Huntoon.
A liberal is one who can be open-minded about anything
except the past; about that he is strictly a bigot. He divides
the past into two broad categories, the "progressive" and the
"reactionary," and once a thing has been placed in the latter
column (also called "Neanderthal" or "medieval"), it never gets
another chance.... In the terse formula of the Brezhnev Doctrine:
"What we have, we keep."
Joseph Sobran, January
Court Upholds Jury Findings in Poliner
The U.S. District Court for the Northern District of Texas
has upheld the findings of the jury in the case of Poliner v.
Texas Health Systems (No. Civ. A.3:00-CV-1007-P), stating
that Dr. Poliner is entitled to judgment as a matter of law on
his defamation claim. The actual amount of the damages, which the
jury pegged at $366 million, has been referred to mediation.
Defendants took action to destroy Dr. Poliner's practice and
his reputation, although admitting that they did not have enough
information to assess whether Dr. Poliner actually was a danger
to patients. They told him he could not consult an attorney and
gave him no opportunity to be heard.
The jury saw through the medical complexities to understand
that sham peer review is a form of "mobbing," writes AAPS Sham
Peer Review Committee Chairman Lawrence Huntoon, M.D. It also
understood that signing an abeyance of privileges under threat of
summary suspension is not "voluntary," and that dredging up cases
from the distant past does not prove an "immediate" danger.
"Hospitals will do everything in their power to see that
such a case never makes it to a jury," Dr. Huntoon said.
The Horty Springer law firm is announcing seminars to teach
hospitals "how to live with the Poliner decision." See AAPS
News of the Day 4/7/06, www.aapsonline.org.
Medical Staff Wins in Florida Case
A special law applying essentially to only one hospital, an
apparent attempt to circumvent court rulings upholding a medical
staff against a hospital, is unconstitutional, ruled Leon County
Circuit Court Judge Janet Ferris (Lawnwood Medical Center v.
Randall Seeger, M.D., Case No. 2003 CA 2865).
Medical staff bylaws are a contract, and the law tramples on
the obligations of contract in order to serve a special private
interest, ruled the Court (News of the
In effect, the law gave the Hospital Corporation of America
hospital plenary power over the medical staff.
Dr. McKalip Challenges Reporting Requirement
A proposed Florida rule requiring that hospitals report
Surgical Infection Prevention (SIP) measures has been challenged
by surgeon David McKalip, M.D. (McKalip v. State of Florida
Agency for Health Care Administration, Case No. ID05-5079).
In an amicus brief, AAPS argues that the reporting rule
effectively elevates disputed SIP guidelines for the use of
prophylactic antibiotics to the standard of care. Even if the
physician believes that antibiotics would be beneficial for a
longer period in a complex case, and even though the patient is
willing to pay for them, the physician might be reluctant to
"raise a red flag" with the hospital and regulators by ordering
treatment that deviates from the standard.
First Hospital Excluded for Violating CIA
Although the Office of Inspector General excludes an average
of 3,000 to 3,600 providers a year, most of them smaller entities
such as physician practices, the OIG doesn't like to deliver a
financial death knell to hospitals. South Beach Community
Hospital is the second ever to be excluded, and the first for
violating a Corporate Integrity Agreement. It was already
bankrupt (MCA 3/20/06).
"Precautionary" Measures. In its latest audio course
offering, the Horty Springer law firm advocates changes to
medical staff bylaws and credentialing to tighten the hospital's
complete control over physicians. Watch for the insertion of
language to expand the scope of summary suspension. The
"precautionary suspension" basically says that maybe the doctor
is a danger to patients, maybe not; we don't have substantial
evidence right now, but if we suspend him, maybe we can "find"
Lawrence R. Huntoon, M.D., Ph.D., Lake View, NY
Why Tort Reform Failed in Oregon. A 2004 ballot
initiative in Oregon failed by a few thousand votes. Most of the
state, which has a physician shortage, voted for it. Portland,
with a relatively adequate physician availability, voted against
it. Portland also has the medical school, Oregon Health & Science
Univ., which is exempt from the law that applies to private
entities. Total damages, including real economic losses,
are capped at $200,000 per claimant and $500,000 per incident. In
a case brought by a Portland TV news anchor, a jury will decide
whether the limits apply to OHSU's physicians, who claim to be
agents of a public body and thus protected.
Russell W. Faria, D.O., Newport, OR
Free-Market Technology. The best practice in the world
of technology is arguably open source. Linux and IBM have
together developed a viable "bottom up" solution to everyday
needs. Other wildly successful ones include Firefox and
Wikipedia. If I were king, I would decree that physicians could
not purchase proprietary software but would have to use open
source so that everyone could benefit from their successful
ideas. Nothing should come from the top down it is far too
limiting. The same for medical records: software that is
constantly being refined by anti-authoritarian, paranoid privacy
wackos is generally pretty good software. The Hacker
Ethic lays out the perfect case for consumer-driven medical
Richard A. Matthews, HealthBenefitsReform Group
Electronic Medical Records. Centrally designed EMRs
will probably disallow the use of narrative style in progress
notes. Boiler-plate checklists are suitable for turning doctors'
offices into high-volume processing centers. Maybe that's the
point. As vendors work toward a more integrated and searchable
database, the real problem they see is "changing the mindset of
physicians to convince them that managing patient populations is
as important as managing individual patients" (ACP
Observer, March 2006). Physicians who treat patients as
human beings are destined for extinction, along with the
Walter Borg, M.D., New Iberia, LA
Anti-Gravity Machines. Socialists and fascists never
tire of trying to invent the impossible. They think their system
can make better decisions for everyone than 6 billion individuals
can make for themselves. But like gravity, the radical dispersal
of knowledge is part of the human condition. The extreme
limitation of the human mind means that control over resources
must also be radically dispersed. Private property is essential
to empower the individual to make the best use of his share of
knowledge. Central planners invent absurd incentives, such as
paying producers of glass by weight (or paying doctors by the RB-
RVS). When all glass was made 3 inches thick, the Central
Committee after long delay changed the incentive, to pay by area.
Then glass was then made 0.1 inch thick. End-users and producers
must be able to contract freely with each other, according to
their own values, to come up with a usable product in medicine
or any other area of the economy.
Robert P. Gervais, M.D., Mesa, AZ
Wrong Assumptions. As long as the controlling paradigm
is that patients are inanimate objects to be delivered for
processing to the "health care system," reforms will fail.
Patients, working with doctors they trust, must control where the
funding goes. An industry that assumes it's entitled to a minimum
of funding, combined with a political class that intends to put a
maximum on funding each disregarding patients' values cannot
produce a successful result.
Sean Parnell, Heartland Institute, Chicago, IL
"Too Stupid to Choose" Coalition. The TSTC coalition of
leftist policymakers, journalists, and advocates complain about
the "bewildering" array of choices confronting seniors in Part D.
It wants people to be stuck in the confines of government-run
medicine to prevent the creation of a real market.
Ernest J. White, Alexandria, VA
The King Can Do No Wrong. Although I never accept
assignment, Medicare occasionally sends me an unwanted check.
Recently, I received one for $41.35; the attached EOB said the
amount due was $117.45. After several "holds" to reach a
supervisor, I was told that Medicare has the right and power
to discount payments [even further] should they receive
insufficient funding for payment of their bills!
Anthony W. Orlandella, M.D., Dana Point, CA
Compromise. You can't compromise and make a truce with
those who want socialized medicine. Equality is their god, and
equality requires government control of medical care. It's like
negotiating with God-inspired suicide bombers. They'll take your
concessions to help their cause, and blow you up anyway.
Linda Gorman, Independence Institute, Golden, CO
Legislative AlertMedicare Drug Implementation
May 15, 2006, is the last day that seniors can enroll in the
new drug entitlement without financial penalty. We will then
have enough data to assess the initial impact of the massive
Medicare drug entitlement, including enrollment, cost, and
satisfaction. In sheer numbers, the Administration appears to be
on track with 25.4 million beneficiaries with drug coverage; the
Congressional Budget Office (CBO) projected that 29 million
enrollees would enroll in the drug program in the first year.
The facts show, however, that an overwhelming majority of
these folks have been automatically enrolled by third-
party payers, including former employers getting billions of
dollars in new government subsidies, the Medicare Advantage plans
that have drug coverage already, and dually eligible senior and
disabled people in the Medicaid program. The last group had no
choice at all in the matter. But that's where the implementation
problems appear to have been the greatest.
What about those who voluntarily signed up for the program?
According to a March 2006 survey of seniors conducted for
America's Health Insurance Plans (AHIP), the largest insurance
trade group, more than eight out of ten seniors had no problem
enrolling or using their new drug benefit; more than six out of
ten say that they would recommend it to other seniors; and only
3% of seniors reported a problem enrolling and using the benefit.
Meanwhile, as we predicted when the Medicare Modernization
Act (MMA) was signed into law in December 2003, the creation of a
universal government entitlement for prescription drugs would,
sooner or later, result in the imposition of government price
controls on drugs. The entitlement structure creates the policy
dynamics. (It's the structure, stupid!) For the Left,
that was the game plan all along, after filling up the notorious
donut hole. Only very foolish or delusional Republican
congressional collaborators a minority, we're certain have ever
thought otherwise. It would only be a matter of time.
Well, an amendment recently offered by Senator Ron Wyden (D-
WA) and Olympia Snowe (R-ME), and backed by the well-heeled AARP,
would provide the federal government the authority to "negotiate"
drug prices in Medicare. Under Section 1860D-11(1) of the MMA,
the Secretary of HHS is prohibited from interfering in
negotiations between private health plans and drug manufacturers
or setting up a national formulary (a list of "preferred" drugs)
that would be available to Medicare patients. This form of the
price controls "Government Negotiated" pricing simply means that
the government will deny access to the market for any companies
that don't accept the government price for drugs. It passed
54 to 44 on the Senate version of the budget bill, with Senate
Republican defections on the issue. This was not surprising.
After all, in 2005, 51 members of the Senate endorsed overturning
the current legal restriction that forbids the Secretary of HHS
to "negotiate" drug prices for the Medicare program. Look for the
Left to launch, with the full backing of the AARP, a similar
effort in the House of Representatives.
Drug Facts on the Ground
What is doubly curious about the recent Wyden-Snowe
victory in the Senate is that it comes at a time when the
private-sector negotiation over drug prices is working very well
to control Medicare drug costs. In fact, the top private-sector
prescription benefit managers already have larger shares of the
market than Medicare, and thus heavier "market clout" than
Medicare itself. When the drug entitlement was enacted, the
initial cost projection for the average monthly premium for drug
coverage was $37 per month; it is, in fact, now $25 per month, or
We fully confess, as vocal critics of the Medicare drug
entitlement, that we did not anticipate either the level of
competition that emerged over the past year for a stand-alone
drug benefit, nor did we imagine the size of the actual premium
reduction. Recent CMS data shows that 93% of beneficiaries have
access to a stand-alone Prescription Drug Plan (PDP) with a
monthly premium of $15. More than 50% of the competing drug plans
offer a richer benefit package than had been previously
anticipated, with no deductibles, lower copayments, or partial or
complete closure of the notorious "donut hole" (the $3,600 out-
of-pocket gap in coverage). Within Medicare Advantage plans,
almost three out of four Medicare beneficiaries have access to a
drug plan without any extra premium. As with normal health plans,
drug coverage is integrated into the MA plan benefit coverage. Of
course, that could have all been easily accomplished through the
original premium support proposal that Congress rejected during
the 2003 Medicare debate.
It is also worth noting that the CBO has repeatedly told
Congress that the far more flexible private-sector process of
negotiation over drug prices, using price discounts and rebates
and other tools of cost control, would be more effective than the
government price-setting mechanism, which would simply exclude a
drug that did not or could not meet the government's price level.
Naturally, the Left points to the Veterans Administration program
as a superior program. While it is a single-payer system, like
Medicare, it is very different from Medicare in its structure,
function, and patient population; it has stricter formularies
than obtain in the Medicare program and accounts for only 2.1% of
drug expenditures in the United States. This makes it unlikely
that VA-style price controls would be replicated in Medicare with
the same effect, though it would surely result in a massive cost
shifting to consumers in the private sector.
Ethical Health Plans?
High-profile controversies over costs and coverage have
largely obscured an emerging debate over ethical issues,
including the rights of conscience and personal choice.
The rights of conscience for doctors, nurses, or
pharmacists, over issues like abortion or end-of-life care, have
gotten the most media coverage. Some doctors insist on following
the Oath of Hippocrates or a variant of it; but most physicians
don't subscribe to the Oath of Hippocrates any longer or worse,
subscribe to a watered-down version.
A debate about the right of conscience among
patients is potentially more important. They don't
effectively have many rights. For example, 46% of employees,
according to a recent Kaiser Family Foundation survey, are in
insurance plans that cover abortion. So, we have whole classes of
Americans who pledge themselves, on Sundays, to moral and
religious beliefs requiring the defense of life, then directly
finance abortion through their insurance premiums at their
workplace. They may finance other ethically controversial items,
too. But most don't know it. Employers or union officials make
decisions about benefits without regard to an employee's beliefs
or preferences. Changes in tax and insurance laws would enable
people to choose an insurance plan in accord with their own
values. Sen. Sam Brownback (R-KS) has indicated that he will be
introducing legislation that would enable people to opt for
values-driven plans or plans sponsored by religious
It's been building for months. An op-ed here, an
editorial there. Public intellectuals of the Left have been
making single-payer noises, notably Harold Meyerson of The
American Prospect and Paul Krugman of The New York
Times, But the recent editorial in The New Republic
makes it official: the big single-payer surge is on. Its editors
have just outlined the case for having the government take over
the entire medical system. It announces: "Government isn't the
best way to provide all Americans with health security. It's the
only way. And it's time for liberalism to say so
The New Republic editors say the best single-payer
model for America is drum roll, please Medicare. The system with
a little debt of $30 trillion and growing, and tens of thousands
of pages of bureaucratic rules many of them profoundly stupid is
the model of "fairness" and "efficiency."
The key decisions in a national health system are budgetary
that is, political decisions. Not medical or even conventional
economic decisions. Congress would be in charge of all medical
care. Ponder that prospect.
A crucial issue is whether Americans would be free to spend
their own money on legal medical services of their choice without
government restrictions. In Canada, despite a recent Canadian
Supreme Court decision, there are still obstacles. In the United
States, Medicare beneficiaries are denied this option.
Britain provides an escape hatch for those patients
dissatisfied with the government system, and in 2005, 6.9 million
British subjects, 11.5% of the population, were enrolled in
private medical insurance. British patients can also contract
privately with British doctors, including those who work in the
NHS, on a case by-case basis. Curiously, more than 40% of
doctors in British hospitals also are enrolled in private
A system based on central government planning is always slow
to change; in fact, bureaucracies are largely unsuitable for
executing rapid change. Bureaucratic institutions, such as the
lumbering Medicare or Medicaid bureaucracies in the United States
or the National Health Service in Britain, do not and cannot
quickly adapt to changing conditions in the same fashion as
private firms in a highly competitive market. Because government
officials must weigh the cost to the taxpayers of any medical
treatment against a perceived benefit, there is an added
incentive to restrict or reject more expensive drugs, treatments,
or procedures. Recently, Britain's National Institute of Clinical
Excellence (NICE George Orwell call your office!) recommended
against the use of Aricept, an expensive drug to treat patients
suffering with Alzheimer's disease that is widely available in
the United States. The British panel determined it was too
expensive for the NHS but modified its restrictions after
protests from thousands of British patients and caregivers.
The single-payer final solution does not eliminate problems
with patient safety, care coordination, treatment for chronic
disease, and patient-physician communication, but may in some
cases exacerbate them, as international comparative surveys show.
American advocates of a single-payer system often
acknowledge the shortcomings of the British or the Canadian
system such as waiting lines and rationing but say that they
will do it better or do it differently (or will make it go away
with more funding). They will be superior in their conception and
execution of the government program. They will work hard, put in
long hours, burn the midnight oil, order carry-out pizza, hire
the best brains that Lefty think tanks can spare, refine every
government payment formula for doctors and hospitals, collect
enormous amounts of data, and run computer models that would
baffle Albert Einstein. The tacit assumption: American
technocrats would be superior to sincere British socialists or
Canadian bureaucrats at running a socialist system for financing
and providing medical care.
Right. You can count on it.
Robert Moffit is Director, the Center for Health Policy
Studies at the Heritage Foundation, Washington, D.C.